Medical Costs 2021- Analyst Insights from PwC Health Research Insittute

Medical Costs 2021- Analyst Insights from PwC Health Research Insittute

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  Medical cost trend: Behindthe numbers 2021 Health Research Institute Medical cost trend in the midst of the COVID-19 pandemic
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  PwC | Reporttitle Ben Isgur Health Research Institute Leader Ingrid Stiver Senior Manager, Health Research Institute Today’s speakers
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  Medical cost trendcould range from 4% to 10% in 2021 What is medical cost trend? Medical cost trend is the projected percentage increase in the cost to treat patients from one year to the next, assuming that benefits remain the same. This report estimates medical cost trend for fully insured large group plans and large, self-insured employers. Source: PwC Health Research Institute medical cost trends, 2007-2021 *Note: The 6% trend shown for 2020 was projected in PwC Health Research Institute’s “Medical Cost Trend: Behind the Numbers 2020” report in June 2019. This number does not reflect the impacts of COVID-19 on 2020 employer healthcare spending. Actual spending in 2020 likely will be lower than in 2019, because of the care deferred during the COVID-19 pandemic. Please refer to the Appendix and the “Macrotrends” section of this report for a deeper discussion of the impacts of COVID-19 on 2020 employer healthcare spending.
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  Employer healthcare spendingcould fall in calendar year 2020 compared with 2019, and then rebound in 2021 Source: PwC Health Research Institute interviews with executives at employer coalitions, healthcare coalitions and health plans between March and May 2020 Impact on spending compared with prior year
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  Individuals with complexchronic conditions on employer-sponsored insurance were more likely to have delayed care Source: PwC Health Research Institute consumer survey, Apr. 28 - May 8, 2020 and PwC Health Research Institute analysis of Medical Expenditure Panel Survey data for individuals with employer-based insurance, 2015-17 Note: Six of the seven HRI consumer groups are shown in this breakdown of employer-sponsored insurance by consumer group. The frail elderly consumer group is excluded as this consumer group generally does not apply to individuals with employer-sponsored coverage.
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  As a trustedsource, providers have an opportunity to better communicate with their patients during the pandemic Source: PwC Health Research Institute consumer survey, April 28-May 8, 2020 of individuals with employer-based insurance said they have received health information from their health system during the pandemic Source: PwC Health Research Institute COVID-19 consumer survey, April 2-17, 2020 14% Ranked as top source of reassurance for rescheduling delayed care
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  During the GreatRecession, unemployment increased by 8 million and employer-sponsored health insurance dropped by over 11 million Source: PwC Health Research Institute analysis of CMS national health expenditure data and Bureau of Labor Statistics current population survey data Number of individuals who could lose their employer-sponsored insurance in 2020, or roughly 10.5% of people who had such coverage before the pandemic Source: PwC Health Research Institute analysis of Congressional Budget Office interim economic projections, Bureau of Labor Statistics current population survey data and CMS National Health Expenditure data 18M
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  Factors affecting 2021medical cost trend COVID-19 boosts mental health utilization Telehealth goes mainstream New specialty drugs and expanding indications for approved specialty drugs increase spending Networks narrow out of necessity Inflators Deflators
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  PwC | Reporttitle 12% of consumers with employer- based insurance said they sought help for their mental health as a result of the pandemic COVID-19 boosts mental health utilization 9 An additional 18% 440%0 %0% reported plans for accessing care for mental health needs Americans are struggling with sleep, diet, exercise and too much time spent on technology. Source: PwC Health Research Institute consumer survey, April 28–May 8, 2020 Source: Kaiser Family Foundation, “KFF health Tracking Poll – Late April 2020: Coronavirus, Social Distancing, and Contact Tracing,” April 24, 2020; and PwC Health Research Institute COVID-19 consumer survey, April 2–17, 2020. Inflator: Mental health
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  Individuals with complexchronic disease and mental illness cost employers 12x more than healthy ones Source: PwC Health Research Institute analysis of Medical Expenditure Panel Survey data for individuals with employer-based insurance, 2015-17 Inflator: Mental health
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  PwC | Reporttitle of the drugs estimated for release in 2020 are specialty drugs 62% 73% 11 of the drugs estimated for release in 2021 are specialty drugs Gene therapies are estimated to be released in 2020 and 2021 Most medications in the pipeline are specialty drugs 11Source: PwC Health Research Institute analysis of OptumRx first quarter 2020 brand pipeline forecast Inflator: Specialty drugs
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  Expanding indications forapproved specialty drugs increase spending As the number of FDA- approved indications for this class of drugs has grown, so have annual sales Source: PwC Health Research Institute analysis of GlobalData’s Drug Sales and Consensus Forecast data for US-based sales of anti-PD(1)/PDL(1)s, Drugs@FDA data for anti-PD(1)/PDL(1)s and OptumRx’s first quarter 2020 brand pipeline forecast. Note: This analysis included sales and FDA-approved indications for Keytruda, Opdivo, Tecentriq, Imfinzi and Libtayo. The cumulative number of indications includes each unique indication by drug. If two drugs in this class are approved for the same indication, that indication is counted twice. The FDA-approved anti-PDL(1) Bavencio was excluded from this analysis because no specific US sales data were available. The number of approved indications for 2020 includes four additional indications expected to be approved by the FDA for Imfinzi, Keytruda and Opdivo in 2020, according to the OptumRx first-quarter 2020 brand pipeline forecast. Anti-PD(1)/PDL(1) cumulative indications compared with annual sales Inflator: Specialty drugs
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  of employers surveyedby PwC in spring 2020 offered telemedicine through either their medical vendor or a carve-out vendor, up from 56% in 2016 Source: PwC Health and Well-being Touchstone surveys, 2016 and 2020 95% Telehealth goes mainstream of consumers with employer- based insurance surveyed by HRI in early April reported using a video telehealth visit before the COVID-19 pandemic Source: PwC Health Research Institute COVID-19 consumer survey, April 2-17, 2020 15% Deflator: Telehealth
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  Most commercial insurersare temporarily waiving cost sharing on telehealth visits during the COVID-19 pandemic In an analysis of recent press releases issued by 25 national and regional health plans, HRI found that 21 temporarily waived cost sharing for all telehealth visits on their fully insured large group plans Source: PwC Health Research Institute analysis of health plan press releases for 25 national and regional payers as of June 18, 2020. See report endnotes 115-141. Under the CARES Act, employers can waive cost sharing for telehealth on HDHPs for plan years beginning on or before December 31, 2021 Deflator: Telehealth
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  Networks narrow outof necessity of employers were considering a narrow network plan in 2020 28%of large employers offer a narrow network plan 28%of all employers offer a narrow network plan 15% Source: PwC 2020 Health and Well-being Touchstone survey Deflator: Narrow networks
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  35% of individualswith employer-sponsored insurance would choose a narrow network to avoid a premium increase Which of the following would you be most likely to select next year if it meant you could prevent an increase in your monthly premiums? Source: PwC Health Research Institute consumer survey, April 28-May 8, 2020. Deflator: Narrow networks
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  pwc.com SS0619 Thank you pwc.com/us/medicalcosttrends pwc.com/us/healthindustries pwc.com/hri twitter.com/PwCHealth © 2020PwC. All rights reserved. PwC refers to the US member firm or one of its subsidiaries or affiliates, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors. Please see www.pwc.com for further details. 744733-2020 RM MW CT. Contact us Ben Isgur, Health Research Institute Leader [email protected] Ingrid Stiver, Senior Manager Health Research Institute [email protected]
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  Employer per capita spendingscenarios Appendix
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  Source: PwC HealthResearch Institute modeling of potential COVID-19 employer per capita healthcare spending scenarios Note: The scenarios shown above for healthcare spending were modeled on the approach taken by Louise Sheiner and Kadija Yilla of the Hutchins Center on Fiscal & Monetary Policy at the Brookings Institution to model the impacts of COVID-19 and post-pandemic recovery on GDP. See report endnote 160.
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  Source: PwC HealthResearch Institute modeling of potential COVID-19 employer per capita healthcare spending scenarios Note: The scenarios shown above for healthcare spending were modeled on the approach taken by Louise Sheiner and Kadija Yilla of the Hutchins Center on Fiscal & Monetary Policy at the Brookings Institution to model the impacts of COVID-19 and post-pandemic recovery on GDP. See report endnote 160.
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  Source: PwC HealthResearch Institute modeling of potential COVID-19 employer per capita healthcare spending scenarios Note: The scenarios shown above for healthcare spending were modeled on the approach taken by Louise Sheiner and Kadija Yilla of the Hutchins Center on Fiscal & Monetary Policy at the Brookings Institution to model the impacts of COVID-19 and post-pandemic recovery on GDP. See report endnote 160.